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SANTA CRUZ — Two tech entrepreneurs, Justin Laing and Ivan Stanojevic, who met in Santa Cruz more than a decade ago, have returned to the area after building a successful cloud-based tech company for retailers and selling it in June for an undisclosed sum to competitors.
“It’s kind of like the completion of some sort of dream,” said Laing, 34, of the entrepreneurial journey that has brought him home again. Laing and Stanojevic, 32, spent nearly a decade building MerchantOS, which was acquired by LightSpeed, a Montreal, Canada-based, venture capital-funded company. “I definitely feel really privileged and lucky. How awesome it is I live in a time and place and with the right background that I was able to do all this.”
Laing, his wife and two children now live on the Westside of Santa Cruz, about a mile from Stanojevic, who moved back to Santa Cruz with his wife and son in 2012.
As new directors in LightSpeed, Laing and Stanojevic are gearing up for the next chapter: setting up a division office in San Francisco where they will be hiring a team of cloud-based technology developers, as well as a mini-home-base office in downtown Santa Cruz’s NextSpace co-working facilities where they can work a couple days a week.
Working for one of Canada’s fastest-growing companies, which received $30 million in funding last year from Silicon Valley-based Accel Partners, is a huge change for the duo. In their first few years of business, they were largely supported by their wives, a school teacher and an after-school care director and a team coordinator for AmeriCorps. They attended bicycle trade shows, gaining customers one by one, then 10 by 10. Their parents gave them enough money to buy some Dell servers and attend the Interbike trade show in Las Vegas.
It took about three years to get 100 customers and start earning any money from the company. Eventually, in 2006, the company changed its name from BikeSoft to MerchantOS, broadening its scope to other types of retailers. They began serving toy stores, pet stores and outdoor clothing companies as well. They hired their first employee in 2008 and their 23rd employee in June before selling the company.
“It was really rough for that four years,” Laing said. “I’m sure every month I thought, ‘Should I just go get a job somewhere?’ I just really believed that we were going to be successful, that if I just persevered, if we kept working on it, we would eventually get there.”
The pair had other invitations, but LightSpeed, which was about 100 employees and growing fast, felt right, they said. In addition to leadership styles and values, LightSpeed had a sales force and a strong re-seller channel.
“It was this awesome opportunity to grow a large development team, to build a high-quality product and get it into the hands of lots and lots of customers,” Laing said. “I think there’s the making of a large company here and to be part of that is maybe a once-in-a-lifetime experience.”
Dax Dasilva, founder and chief executive officer of LightSpeed, said the companies are complementary. Where MerchantOS provided functional, platform-agnostic products, LightSpeed focused on design for Apple-centric products and a growing sales force. By joining forces they would provide better products, he said.
“We know it’s going to be a great merger,” Dasilva said.
So far, that’s the case, Laing said, noting that their first joint product, LightSpeed Cloud released in late July, has already bested sales even in the typically slow summer month of August.
After a decade of “running it to the wire,” it’s a relief to be working for someone else, Stanojevic said, noting that he just bought himself a 29-inch mountain bike. The merger allows them to unwind from the company some and see things differently. “It’s puts us in a position where we can take even greater risks without bankrupting our families, which is good for LightSpeed ultimately.”
Moving back to Santa Cruz is also a dream. “This is the place to raise kids,” Stanojevic said. “I think this place could be amazing for entrepreneurs who care about the outdoors.”
Of their success, Laing said they worked hard, but really “it was perseverance, just blind perseverance.”